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Portage Wins Shareholder Nod for SalvaRx Acquisition
Friday 11 January 2019

11 January 2019 - Shareholders of Canadian biotechnology company Portage Biotech Inc (CSE: PBT.U) (OTC: PTGEF) have approved the company's pending acquisition of immuno-oncology specialist SalvaRx Ltd. from SalvaRx Group plc, the company said.

Completion of the SalvaRx acquisition remains subject to CSE approval.

The meeting is scheduled for 8 January 2019 for shareholders of record as of 23 November 2018.

In August, Portage announced a definitive agreement to acquire 100% of immuno-oncology specialist SalvaRx.

The vendors are SalvaRx Group plc (SALV: LSE), (94.2%), James Mellon (2.9%) and Gregory Bailey (2.9%).

Under the terms of a sale and purchase agreement dated August 13, 2018, the company has agreed to issue 805,070,067 common shares at a deemed price of approximately USD 0.089 per share to the vendors for an aggregate acquisition cost of USD 71.70m.

Immediately after closing, SalvaRx Group plc will distribute approximately 87% of the Consideration Shares to its shareholders by way of a dividend in kind.

The transaction constitutes a reverse takeover under Canadian securities legislation as the number of shares to be issued exceeds 100% of the current issued and outstanding capital of the company.

On completion of the CSE review, the company and SalvaRx Group plc will publish their respective shareholder circulars and a further announcement will be made.

The vendor, SalvaRx Group plc, which holds approximately 94.2% of SalvaRx Ltd., is an Isle of Man company whose ordinary shares are listed on the AIM market of the London Stock Exchange under the symbol "SALV."

The minority vendors, James Mellon and Gregory Bailey (holding approximately 5.8% of SalvaRx Ltd.), are directors of both the company and SalvaRx Group plc and collectively hold approximately 40% of the issued share capital of the company and 73% of the issued share capital of SalvaRx Group plc.

SalvaRx was founded in 2014 to develop therapies within the rapidly growing immuno-oncology market, which uses treatments designed to boost the body's natural defences to fight the cancer.

Immuno-oncology therapy is a fast growing and new therapeutic area, a market expected to grow to USD 80bn worldwide by 2020 (Global and USA Cancer Immunotherapy Market Analysis 2020).

SalvaRx's strategy is to invest in a portfolio of companies involved in novel cancer immunotherapies and develop them up to clinical proof of concept.

The company provides portfolio companies with operational support in addition to capital, either by managing its portfolio companies directly or augmenting an existing team.

SalvaRx's management team have a track record of discovering and commercialising drugs in the area of cancer immunotherapy with Bristol-Myers Squibb and Johnson and Johnson.

The team is supported by an extended network of senior academic and industry executives to promote commercial and scientific outcomes, including licensing and partnering discussions.

SalvaRx Ltd. has utilized shared resources at the parent level to identify, build, and operate five companies.

SalvaRx holds a 60.49% interest in iOx Therapeutics Ltd.

Other stakeholders include Oxfordniversity. iOx's strategy is to develop a new type of immunotherapy against cancer, originally discovered through a partnership between the Ludwig Institute and Professor Cerundolo, director of the MRC Human Immunology Unit and head of the Department of Investigative Medicine at the University of Oxford.

Nekonal Oncology Ltd. is a joint venture company between SalvaRx and Nekonal SARL of Luxembourg focussed on the development of first-in-class antibodies against a novel T-cell based target having potential for use as a monotherapy and combination therapy for solid and haematological malignancies.

SalvaRx owns 34.99% of Rift Biotherapeutics Inc., an early stage research and development Delaware company founded to discover and develop first-in-class antibodies implicated in the inflammatory tumour and tumour infiltrating immune cells microenvironment.

Rift recently won the Boehringer Ingelheim Innovation prize, entitling it to expanded lab space at BioLabs San Diego, a Southern California based incubator for biotech start-ups. SalvaRx has an option to acquire additional equity in Rift.

Saugatuck Therapeutics is a joint venture with Immunova, LLC, a private, Delaware-domiciled biotechnology company focused on use of nanolipogel technology. Saugatuck holds an exclusive licence from Yale University via Immunova for use of the NLG platform for delivering DNA aptamers and certain aptamer-based combination products.

SalvaRx holds a 9.2% interest in Intensity Therapeutics Inc. through a USD 2m investment. US-based Intensity is a private biotechnology company pioneering a new approach to treating solid tumours.

Intensity's platform, DfuseRx, identifies novel formulations that can be comprised of currently approved and effective cytotoxic or other anti-cancer agents for direct injection into solid tumours.

The Intensity products not only directly kill tumour cells, but also improve the presentation of tumour antigen to the immune system.

Intensity's lead product, INT230-6, shows strong efficacy in preclinical models against the primary injected tumour without the devastating systemic exposure normally associated with cytotoxic compounds.

Moreover, this lead compound can stimulate a potent systemic immune response that affects distal tumours.

The company will also be seeking shareholder approval to a consolidation of its common shares up to a ratio of 120: 1 with the final exchange ratio and implementation date to be determined at the discretion of the directors of the company.

As required under the CSE rules, a name change will accompany such consolidation if, as and when effected.
Date Published: 11/01/2019
Target: SalvaRx Ltd
Country: Canada
Deal Size: 71.70m (USD)
Sector: Biotechnology
Type: Corporate acquisition
Financing: Stock
Status: Agreed
Vendor: SalvaRx Group, James Mellon,  and Gregory Bailey 
Buyer: Hitachi Data Systems Corp